O’Farrell moves to tackle spending

The NSW government claims the need to keep a close rein on spending and reduce debt is behind the reduction of the role of Treasury.

Treasurer
Mike Baird
told The Australian Financial Review Treasury remained the “principal economic agency" after responsibility for land, gaming and payroll taxes was transferred to a new department of Finance and Services this week.

The aim of the shake-up was to give the new department, headed by federal Labor minister Tanya Plibersek’s husband, Michael Coutts-Trotter, “some focus . . . on expenditure review", he said.

The federal Department of Finance keeps tabs on government spending and cuts departmental programs ahead of budgets.

The state Finance and Services Minister, upper house MP
Greg Pearce
, will also oversee the Office of State Revenue and public service superannuation.

The portfolio reshuffle drops the number of state acts administered by the Treasurer from 73 to 50.

Mr Pearce, a former commercial lawyer with more than 10 years’ parliamentary experience, insisted yesterday cabinet was a united team.

“We have younger people with fantastic skills like Mike, I’m a bit older, I’ve been around a bit longer," he told ABC radio.

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Premier
Barry O’Farrell
said there would be none of the infighting that led to the Labor government’s downfall.

Mr O’Farrell has also charged Mr Pearce with reducing government debt, a role usually performed by the Treasurer.

Mr Baird said the changes were “still under discussion", but it came as no surprise that Mr
O’Farrell
wanted to boost the role of Finance in the new government.

“I’m delighted with my role and the intention is very clear, and that is that Treasury and Finance will work very closely together," he said.

“There is no difference between the way we operated in opposition and the way we will operate in government."

A former investment banker and son of former state and federal politician Bruce Baird, the NSW Treasurer is touted as a future leader of the party, but some worry about his lack of experience and ability to get his agenda through the party room.

Mr Baird rejected claims that Mr O’Farrell had demoted him because he posed a future leadership threat.

“There’s nothing further from the truth," he said. “Barry and I remain good mates; we’re determined to turn around NSW and we’re working out the best model for the way Treasury and Finance can work together."